Management of a Leighton Holdings company working on Chevron's Gorgon LNG project have been accused of slashing costs submitted by staff which showed blowouts of up to $2 billion.
Leighton Contractors has denied the claims by former members of the Barrow Island LNG jetty project, which come as Leighton Holdings and former executives fight reported allegations of making corrupt payments overseas.
The company is pressing Chevron to once again increase the value of the jetty contract, citing soaring costs and delays. When Chevron agreed to lift the Saipem Leighton consortium's jetty contract to $1.85 billion mid-last year, members of the project staff said they had told Leighton Contractors' management it would cost about $3.5 billion to finish.
Those with knowledge of the project now estimate it could cost about $4 billion. "They're disastrous numbers," a former team member said. "The actual cost to date would be exceeding the revenue right now."
Former project staff said costings submitted to monthly contract reviews in Perth were changed to match revenue figures and the team told to work from those amounts.
"I refused to change it," one said. "It just got changed anyway when it got reported up to the corporate level.
"What they're doing is wrong. They're not being honest to the market, the shareholders."
Another former project member claimed two sets of books had to be kept to keep track of the real costs of the project. "You lose sense of what's reality after a while," he said.
Team members who questioned changes to budget figures were allegedly told it was not their concern. "I wasn't comfortable doing what we were doing," an ex-staffer said.
The jetty project is said to be notorious for "miserable" morale and high turnover.
A Leighton Contractors spokeswoman said: "We completely reject assertions that we have 'doctored' costs. The project has been the subject of regular audit reviews."
The project continued to face increased costs and schedule impacts, the spokeswoman said. These included labour and productivity associated with site infrastructure, logistics challenges and weather delays.
"We are in discussions with our client about variations we have submitted to reflect the increased costs," she said. Chevron would not comment.
Leighton Contractors said 37 of the jetty's 56 concrete caissons had been put in place, with the positioning of another three under way. A mid-2012 update had said the facilities would be delivered this month.The former Leighton team members believed it would be a struggle to finish the project before early 2015, when Gorgon is scheduled for first LNG cargo.